Lean Mindsets & Behaviors

Creating a High-Performance Climate for

Sustained Transformation

Mike Osterling & Karen Martin

AMEChicago2012
October 15, 2012
 Learning Objectives
• The macro‐ and micro‐behaviors that are at the core of 
excellence.
• How to identify the gaps between “what is” and “what 
needs to be.”
• How to create an operational climate that enables 
people to grow and succeed.
• How to develop Lean mindsets and behaviors 
throughout your organization.
• How to instill and reinforce the new ways of operating.

2
 Success with Improvement
2001 – The Economist
70%
63%
60%

50%

40%

30%

20% 17% 20%

10%

0%
None Temporary Lasting
3
 …A Decade Later
2010 – Accenture
80%

70% 69%
60% 58%
50%

40%
33%
30%

20%

10%

0%
“Mixed” to  Minimal  Needs re‐evaluation, 
“disappointing”  financial  restart or complete 
results impact makeover 4
 To Err is Human
Institute of Medicine, 1999

98,000 lives lost

Improvement Goal:
Reduce by 50% 
in 5 years.

5
6
 Something Is Terribly Wrong…

Up to 98,000 people  180,000 Medicare 
die from medical  patients die annually 
errors. from medical errors.
To Error is Human,  Office of the Inspector 
Institute of Medicine 2005 General 2011

1999 Progress has been  2010 33% hospitalized 

slow. patients are harmed; 
7% result in permanent 
Journal of the American 
Medical Association injury or death.
Health Affairs

7
We need to 
improve
how we improve.

8
Self‐inflicted

9
A Chaos‐Cracked Foundation 
Can’t Support Excellence

10
 11

Resilience
Agility
Business Results

Innovation
Continuous 
Improvement
Problem Solving

that Reduce 
Mindsets & 
Behaviors 

Chaos
 Clarity

Engagement Focus

Discipline

12
“Effectiveness is a 
habit.”
— Peter Drucker

13
 Group Discussion
1. Clarity

2. Focus

3. Discipline

4. Engagement

14
 Group Activity ‐ Behavioral Gaps
• Part 1 – Rate your organization (company, facility, 
department, etc.).  2 minutes
– Which of the four behaviors is it weakest in?
• Part 2 – Move to the appropriate corner for your 
weakest org behavior. 15 minutes
– Give examples of the lack of that behavior
– Which metric(s) do they affect (hard impact)?
– How do they affect customers, employees and/or 
suppliers (soft impact)?
– Select one example & its impact to share with the full 
group.
• Part 3 – Report out. 10 minutes
15
 Activity: Behavioral Gaps
Hard Costs Soft Costs
Lack of Clarity

Lack of Focus

Lack of Discipline

Lack of Engagement

16
 17

Resilience
Agility
Business Results

Innovation
Continuous 
Improvement
Problem Solving
18
 Junk Words* (10 mins)

• The line at Starbucks is long. _________________

• That car is expensive.  ______________________

• That would be a long commute. ______________

* Conceptualized by Sammy Obara, Toyota by Toyota
19
 Seek Unbridled Clarity Around…
1. The direction your organization is heading in.
2. Who your customers truly are and what needs 
they have.
3. What value you deliver.
4. How specifically you deliver and support the 
delivery of value.
5. Who delivers and supports the delivery of 
value.
6. How you’re performing.
7. The language you use.
20
“Going to the gemba 
has been life changing 
for me as a leader.”
‐ Ginny Cattaneo, Sr. VP, Franklin
Templeton Investor Services 

21
 Lean Management System

Plant Manager 
Standard Work
Value Stream Manager 
Standard Work

Supervisor Standard Work

Team Leader Standard Work

Standardized Processes 22
Truth
Truth
Truth
Truth
Truth
Truth
Truth
Truth
Truth 23
 24

Resilience
Agility
Business Results

Innovation
Continuous 
Improvement
Problem Solving
Distraction Kills

25
 Focus Needs
1. Priorities – What are you striving for? What’s 
important to accomplish THIS year?
– Products
– Processes
– Marketplace
– Margins
– People
2. Meetings – What’s the purpose of the 
meeting? 

26
 Booz & Company Findings
90%
82%
80%
70%
64%
60%
49%
50%
40%
30%
20%
10%
0%
No written Conflicting Competing
priorities priorities demands

27
There is no such thing 
as multitasking.*

* For cognitive tasks.

28
 The Myth of Multi‐tasking

• It’s not possible to do two conscious activities at 
once.
• You are “switch‐tasking.”
• David Meyer – University of Michigan
– Engineers switched between projects 5‐8 times per 
day
– Each switch added 20 minutes of process time
– If switch only 5x per day, adds 1.7 hrs per day or 407 
hours (10 weeks) of process time per engineer
– In company w/ 15 engineers = 3 FTEs* worth of labor.
* FTE = Full Time Equivalent

29
 A Key to Apple’s Success?

“…saying no to 1,000 
things to make sure we don’t 
get on the wrong track or try to 
do too much. We’re always 
thinking about new markets we 
could enter, but it’s only by 
saying no that you can 
concentrate on the things that 
are really important.”
— Steve Jobs

30
 Round 1
Task 1: Lack of focus causes chaos

Task 2: 1   2   3   4   5   6   7   8   9   10   11 
12 13 14 15 16 17 18 19 20 21 22

Round 1 – Letter, number, letter, number: L, 1, A, 2, C, 3, etc.

_________________________________________________

_________________________________________________
31
 Round 2
Task 1: Lack of focus causes chaos

Task 2: 1   2   3   4   5   6   7   8   9   10   11 
12 13 14 15 16 17 18 19 20 21 22
Round 2 – full sentence, followed by numbers 1‐22.

_________________________________________________

_________________________________________________
32
 The Countermeasure: Strategy Deployment
 Aka Hoshin kanri; policy deployment
 Hoshin – Direction; compass; shining needle
 Kanri – Management
 Two key parts: Creating the plan itself & 
and fanatic management to that plan.
 Purpose: Organizational focus & 
alignment
 Aligns everyone toward a few high impact 
objectives while also keeping them 
accountable for their commitments through 
visual management and review.

33
 Strategy Deployment Key Feature: 
Catchball
What?
How? Executive 
Who? Team
When?

What?
How? Senior 
Who? Mgmt
When?

What?
How? Middle 
Who? Mgmt
When?

What?
How? Frontlines
Who?
When?
34
 Improve Productivity through Greater Focus

Productivity (Pounds Produced / Hr Worked)

115.0

Pactiv
108.0
Implements
Strategy 105.9
Deployment

101.0

95.2
94.0 93.0
90.6

87.0 86.3
84.8

80.0
FY '06 FY '07 FY '08 FY '09 FY '10 YTD '11

35
Activity: Achieving Focus 
List Potential Projects
Lean Mindsets & Behaviors
Achieving Focus: Project Prioritization

Project / Priority

36
 “Hoshin‐Lite” Annual Work Plan
PRE ‐ Gain clarity around overarching business needs.

1. List everything you could do (and that you are doing and 

you plan to do).
2. Categorize into:
– Must‐do, can’t fail
– Maybe
– Eliminate
– Delay (next fiscal year)
3. Decide what you will do; gain consensus.
4. Prioritize and create plan.

POST ‐ Manage plan via weekly updates (may be able to reduce 
to monthly reviews – but be careful!).
37
 Achieving Focus
Categorize project list
Lean Mindsets & Behaviors
Achieving Focus: Project Prioritization

Project / Priority Must Do Eliminate Delay Maybe

Project A X
Project B X
Project C X
Project D X
Project E X
Project F X
Project G X
Project H X
Project I X

38
To create new 
ideas is a gift, but 
to choose 
wisely is a skill.
‐ Ryan Morgan

39
 Achieving Focus
Move “Maybe’s” into Other Categories
Lean Mindsets & Behaviors
Achieving Focus: Project Prioritization

Project / Priority Must Do Eliminate Delay Maybe

Project A X
Project B X
Project C X
Project D X
Project E X
Project F X
Project G X
Project H X
Project I X

40
 Label Four Flip Chart Pages & Hang on Wall
Must do Maybe
1. List what you could do on 
3x6” post‐its (active or 
planned initiatives, 
projects & improvement 
activities). Gain consensus.

2. Categorize them (place 
post‐it on appropriate 
page. Gain consensus.
Delay Eliminate
3. Decide what you will do. 
(Move “maybe’s” onto one 
of the other three pages.) 
Gain consensus.

41
 Must do Maybe

Step 4
Prioritize 
must‐do’s; 
Create Plan

Delay Eliminate

42
 PACE Improvement Prioritization Grid
9 22 17
23
8 3 21
Easy
10 4
13
5
15
Ease of Implementation

20 14
19 1
16

7 6

2 11 18

12
Difficult

Low High
Anticipated Benefit 43
 Achieving Focus
Prioritize Must‐Do’s

Easy
Ease of Implementation
Difficult

Low High
Anticipated Benefit 44
 Annual Improvement Plan
Company ABC
Priorities
FY 2012 FY 2013 Exec  Tactical 
Priority Others
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Owner Owner
MS‐2 
MS‐1
Integrate DHR Begin Acct Brad P
Ops
Complete
Complete New 
Travel Program  Begin Complete Scott R Fred S
Roll‐out

Roll‐out Tablets to  Begin & 
Brad P
Installation Complete

Lisa D, 
Complete 360  Marina,
Begin Complete Justin C Steve R
Roll‐out SM, Tech,
Hal, Doug

Create Line‐item 
Begin Complete Lisa B Mark C
P.O.s

Refinance credit 
Begin Scott R
facility

Complete ADP 
Begin Complete Gary O
Roll‐out

Not 
Develop & Roll‐out  MS‐1 MS‐2 MS‐3
Begin complete  Steve C TBD
Handheld 2.2 Clean Code Pilot Go live
until 2013

Complete GPS  RDs Cons., 
Begin Complete Steve C
Roll‐out HR, Fleet

Complete "River" 
(One Soft)  Begin Complete Lisa B
Roll‐out

Develop Safety 
Begin Complete Gary O
Program

45
 Annual Improvement Plan
Tier 1 Priority: Executive Owner: Date Created:

Tier 2 Priority: Tactical Owner:
Background/Scope: Next Review:

Measurable Objective(s):
Core work team: Input/Review needed by:
Relationship to Annual Business Goal(s): Timeline
Status
= Original Plan X = Complete %  (Red, 
Due  Complete Yellow, 
2012
Date Green)
# Action Item Owner Deliverable Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
46
Frequent Status 
Meetings Assure 
Ongoing Alignment & 
Distraction Avoidance

47
 Sporting Goods Manufacturer
Product Launches Per Year
80
73
70
60 No additional 
resources; 
50 higher quality 
40 products 
launched
30
24
20
10
0
Pre‐Focus Post‐Focus
48
 Rockwell Automation

25
20
20 Projects
15 Started
12 12
10 Projects
5 Completed
3
0
Pre‐Focus Post‐Focus

49
 Avoiding the Shiny Ball Syndrome 
(Organizational ADD) Requires…

• Clarity – about what really 
matters & organizational 
direction.
• Consensus – about how best 
to get there.
• Courage – to actively choose 
to “not do” or “not do now.”
• Commitment – to stick with 
the plan.
From The Outstanding Organization, Karen Martin

50
 51

Resilience
Agility
Business Results

Innovation
Continuous 
Improvement
Problem Solving
 Greatness results from
Disciplined people engaged in disciplined 
thinking that leads to disciplined
action.
— Jim Collins, Good to Great

52
Building Mastery Requires Deliberate Practice

53
How much deliberate practice?

10,000 hours Tied deliberate practice 
(10 Years) to myelin development 

54
 Practice vs. Performance
Perform 
Train 99%
100% 90%

90%
80%
70%
60% Train
50% Perform
40%
30% Perform 
20% 10% Train
1%
10%
0%
Athletes Businesses
Jim Loehr & Tony Schwartz,              
The Power of Full Engagement
55
 Building Mastery

© 2012 Karen Martin & Associates, LLC 56
MASTERY

57
 Discipline is Needed…

• Planning
• Decision making
• Executing
• Problem Solving & Improving
• Managing processes

58
 “It takes a different kind of thinking to 
solve a problem than the kind of thinking 
that produced the problem.”
— Albert Einstein

59
“Most people spend more time and 
energy going around problems         

than in trying to solve them. ”
— Henry Ford

60
The Scientific Method for Problem Solving        
and Improving

61
 Clarifying the PDSA Cycle

Phase Detailed Steps

New 
  1.  Define and break down the  problem.
Problem
50‐80%    2.  Grasp the current condition.
of the  Develop 
Plan   3.  Set a target condition.
total  Hypothesis

  4.  Conduct root cause & gap analysis.
time
Continuous 
  5.  Identify potential countermeasures. Improvement

  6.  Develop & test countermeasure(s)

Conduct 
Do   7.  Refine and finalize countermeasure(s).
Experiment

  8.  Implement countermeasure(s).

Evaluate 
Study   9.  Measure process performance.
Results

10. Refine, standardize, & stabilize the process.
Refine 
Adjust Standardize  11. Monitor process performance.
Stabilize
12.  Reflect & share learning.

62
 Developing PDSA Capabilities

Complex • A3 Management

• Kaizen Events

Simple • Daily Kaizen

63
 Group Discussion
• How many of you are familiar with A3 
Management?
• How many of you have a disciplined A3 
development program across your organization 
(including coach development)?
• If it’s a good idea, why aren’t more 
organizations doing it?
• What can you do about it?

64
 Discipline is Needed…

• Planning
• Decision making
• Executing
• Problem Solving & Improving
• Managing Processes

65
Every key process…
Clearly documented

2‐5 Key Performance Indicators

Continually  
monitored & improved

66
How are you performing?

Gray – Highest industry quality scores
Purple – Median industry quality scores
Blue – Our quality scores

67
 Value Stream Maps: 
Gaining Clarity around Process Performance
 Processes MUST be Clearly Documented, 
Monitored & Improved
Current State Metrics-Based Process Map
PT Units Process Details Mapping Team
Seconds Hours Process Name Order Fulfillment Dianne O'Shea Ryan Austin
Minutes Days Specific Conditions Domestic orders through sales force Sean Michaels Mary Townsend
LT Units Occurrences per Year 37,500 Sam Parks
Seconds Hours Hours Worked per Day 8 Paul Dampier
Minutes Days Date Mapped 26-Nov-07 Michael Prichard
Step # ? 6 7 8 9
Function /
Department Activity PT LT %C&A Activity PT LT %C&A Activity PT LT %C&A Activity PT LT

Customer

Notify customer
Fax PO to
Sales Rep Approve PO 15 240 100% 5 20 100% when they can 15 300 95%
Account Manager
expect delivery

Review and
Account Manager approve PO; send 5 240 100%
to Order Entry

Enter order into

Order Entry 10 240
SAP

Finance / Credit

69
We need to shift our focus from
managing people
to managing processes.

70
Non‐standard Processes Yield Inconsistent Results
R1

R2
Inconsistent
People R3 Results
R4
Inconsistent
Processes

Standard Processes Yield Predictable Results

Desired
People Results
Standardized 
Processes

71
 Process Ownership:
Working On The Business
• All processes MUST have a process owner.
– Closer than farther from the work.
– Recognized as having the authority to lead 
improvement.
• Accountable for process performance.
– Frequent measurement and review.
– Lead/organize cross‐functional problem solving.

72
Don’t Look Away. Ever.

73
Before improving a process,
understand –
really understand –
how it is being performed
today.

74
 Traditional Mapping Method:
Process Flow Chart

How long does the process take?  
How well is the process performing? 
Where are the problems? 75
The Genesis of MBPM
Second Edition

August 2008 October 2012

76
What is Metrics‐Based Process Mapping (MBPM)?

• A visual process analysis tool, which integrates:
– Functional orientation of traditional swim lane          
process maps
– Key Lean metrics:
• Lead Time
• Process Time
• Quality (Percent Complete and Accurate)

77
Metrics‐Based Process Mapping (MBPM)
 Why Create an MBPM?

• To map admin / office processes
• Understand the steps, disconnects, waste, and 
delays – at a micro level
• Measure process performance in terms of:
– Time (lead time and process time)
– Quality
• Visualizes the steps and flow
• Use as standard work for training and process 
monitoring
79
 Typical Current State Findings

Islands of value‐adding activities.
Shift the focus to the NVA elements.
Rework

First Step Last Step
Adding Value

Lead Time

80
 MBPM Results
%
Process Before After
Improvement
New Hire
LT = 25.75 days LT = 17.5 days 32%
Logistics

Purchase
LT = 21 days LT = 8 days 62%
Requisition

Sales Order
PT = 2.7 hours PT = 1.3 hours 52%
Change

Supplies
17 steps 11 steps 35%
replenishment

Product Demo %C&A = 2% %C&A = 20% 900%

81
 MBPM – Getting Started
• Define a clear scope – narrow and deep
– Define the first and last steps for the process to be improved
– Lay out the specific conditions for the process to be mapped
Metrics-Based Process Mapping Charter
Improvement Scope Leadership Mapping Schedule
Value Stream Executive
Date(s)
Process Name Sponsor

Specific Start/End
Process Owner
Conditions Times
Customer Demand
Facilitator Location
Trigger
First Step Mapping Team Food
Last Step Lead Provided

Boundaries & Briefing

Limitations Dates/Times
Required Briefing
Attendees
FS Implementation Logistics
Timeframe Coordinator

Improvement Drivers / Current State Issues Mapping Team

1 Function Name
2 1
3 2
4 3
5 4
Improvement Goals & Measurable Objectives 5
1 6
2 7
3 8
4 9
5 10
Potential Deliverables On-Call Support
1 Function Name Contact Information
2 1
3 2
4 3
5 4
Possible Obstacles Approvals
1 Executive Sponsor Value Stream Champion Facilitator
2
3 Signature: Signature: Signature:
4 Date: Date: Date:
82
 Scope: Refining the Focus
Units

Domestic Consumables
Warranty
Service Parts
Order  Non‐
Fulfillment Warranty
Units

International Consumables
Warranty
Service Parts
Non‐
Warranty
83
 MBPM – Getting Started (continued)
• Select the team (most effective within a kaizen  event)
– Highly cross‐functional – workers, upstream suppliers, 
downstream customers, outside eyes, etc.
• Those who currently do the job
– No more than 10 individuals
– Don’t avoid the “difficult” people
– Include “outside eyes” if possible
• Use a skilled, objective facilitator
• Have a room with (long) wall space for 36” wide 
butcher paper
• Map on consecutive days

84
 Steps in Creating the Current State MBPM
1. Label the map (process, date, team or facilitator)
2. List the functions involved
3. Document all activities / steps
4. Review the map for completeness
5. Number the activities
6. Add activity‐specific information (metrics, etc.)
7. Determine the timeline critical path
8. Create the timeline
9. Calculate the summary metrics
10. Identify value‐adding (VA) and necessary non‐value‐adding 
(N) activities

85
 Documenting the Current State
Step 1 – Label the map in the upper right hand 
corner.
– Include process name, conditions mapped, date, 
and facilitator name and/or team members.

86
 Document the Current State
Step 2 – Label the swim lanes with the functions 
involved.
– Include external functions, if appropriate (e.g. 
customers, suppliers/contractors, etc.)
– Sequence in which functions are listed is not 
important

87
 Document the Current State
Step 3 – Document all activities/steps on 3” x 6” 
post‐its.  Don’t include metrics yet!
– Use verb/noun format; clear and concise
– Include function.
– Separate tasks that have different quality outputs 
or timeframes; combine tasks otherwise.
– Place post‐its in appropriate swim lane, 
sequentially.

88
 Document Each Activity

Activity              
(Verb / Noun) Function that 
performs the 
task

Best to use 
3 x 6” Post‐its

89
Step Step Concurrent 
1 2 Activities

Ticking clock 
90
 Document the Current State

Step 4 – Review map for completeness 
(someone other than the facilitator)
– Walk through the map, reading aloud.
– Verify sequence
– Add missing steps and barriers to flow (“flow‐
stoppers”) if any.

91
 Document the Current State
Step 5 ‐ Number the activities
– Number the activities sequentially from left to right.
– For parallel (concurrent) activities, add “A,” “B,” etc.
• Example: Step 8A, Step 8B, etc.
– Don’t number the post‐its until the map is “final.”

92
 Document the Current State
Step 6 – Add activity‐specific information
– LT – Lead time
– PT – Process time
– %C&A – Percent Complete & Accurate
– Number of people who perform the work
– Barriers to flow
• Batches
• Equipment downtime
• Shared resources, etc.

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 Key Metrics: Time
• Process time (PT)
– The time it takes to actually perform the work to 
complete one item, if it could be worked on 
uninterrupted.
• Lead time (LT)
– The elapsed time from when work is available to be 
worked on until it’s completed and made available to 
the next person or department in the process

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 Key Metrics:  Quality
• %Complete and Accurate (%C&A)
– % of the time the downstream customer can 
perform task without having to “CAC”:
• Correct information or material that was 
supplied
• Add missing information that should have been 
supplied
• Clarify information provided that should have 
been clear

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 Add Activity‐Specific Information
Additional Information

# Staff  
(if relevant)
Barriers to flow 
(if relevant)

% Complete &  PT
Accurate LT
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 Adding Metrics:  Tips
• LT, PT and %C&A are typically acquired via 
interviews – ask high‐quality questions.
• Usually looking for the “typical” LT and PT; 
what happens 80% of the time?
• Select units of measure that are easiest to 
comprehend (e.g. 6 hours instead of 360 
minutes).
• PT is the time required to complete one “thing”
• If your LT is 4 hours, don’t debate a PT of 5 vs. 
7 minutes.

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 Adding Metrics: Tips (continued)
• May be OK to group the LT for a series of 
activities performed by the same function 
(rather than each individual step). 
• Place %C&A value on the post‐it of the source 
step.
– If %C&A issues are identified by multiple 
downstream customers, record each of the 
%C&As on the Post‐it of the source step (can also 
indicate on the Post‐it which step reported the 
problem). 
– 0% C&A is not uncommon

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 Barriers to Flow
• Look at the process from “the thing’s” 
perspective
• Identify issues that prevent one‐piece‐flow of 
the work
– Batching / periodic processing
– Rework
– Bottlenecks
– Handoffs
– Inventory
– Setup / changeover
– Physical layout

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 Document the Current State
Step 7 – Determine the “timeline critical 
path” of the process
– For parallel activities:
• Don’t include “dead end activities”
– Steps / path which don’t move the process forward 
(e.g. filing a document)
• If both paths are required to move forward, 
select the path with the longest total lead time

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Timeline Critical Path

Critical 
Path

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 Document the Current State
Step 8 – Create the timeline
– Bring down the PT & LT from the critical path steps.

Timeline

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 Document the Current State
Step 9 ‐ Calculate Summary Metrics
– Critical Path PT
– Critical Path LT
– Activity Ratio (AR)
– Rolled Percent Complete and Accurate 
(R%C&A)
– Total PT
– Labor Requirements
– Number of Activities

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 Summary Metrics: Time
• Timeline Critical Path PT
– Quantifies how much of the response time (LT) is 
spent actually working on the “thing”
• Timeline Critical Path LT
– Measures speed of delivery to customer & an 
indicator of cash flow
• Activity Ratio (AR)
– The percentage of time work is being done to the 
patient/item/data passing through the process
– AR = (Σ PT ÷ Σ LT) × 100
– 100 – AR = Idle time

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 Summary Metrics: Quality
• Rolled Percent Complete and Accurate 
(R%C&A) = 
– %C&A × %C&A × %C&A × … 
– Out of 100 occurrences, the number of times the 
data/material/people pass through the entire 
process with no rework required (expressed as a 
percentage).

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 Summary Metrics: Labor Requirements

• Total PT
– Sum of all activities, not just critical path
– Factor in determining labor requirements
• # FTEs* Required (Total Labor Effort)
# FTEs  Total PT (in hrs) X # occurrences/year
Required =
Available work hrs/year

* FTE = Full‐time Equivalent
(2 half time employees = 1 FTE)

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 Summary Metrics: Labor Effort
• Total PT
– Sum of all activities, not just timeline
• Labor Effort
Time = Total PT (in hrs) x # occurrences/year

Total PT (in hrs) x # occurrences/year
# FTEs* =
Available work hrs/year/employee**
Freed 
= Current State FTEs – Future State FTEs
Capacity

* FTE = Full‐time Equivalent (2 half time employees = 1 FTE)
** Available work hrs/year = 2,080 ‐ paid holidays and vacations
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 Documenting the Current State
Step 10 – Identify Value‐adding (VA) &
Necessary Non‐value‐adding (N) activities
– Use small post‐its in different colors to 
differentiate VA and N
– Monitor time allowed for debate
– Unlabelled activities = waste

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Value‐adding activity

Necessary non‐value‐adding activities
 Metrics‐Based Process 
Mapping (MBPM) 
Simulation

Order Fulfillment Process:
Demand = 2,500 orders per year
Available work hours per employee per year = 1,800

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 Create the Current State MBPM
Phase I
1. Label the map in upper right corner.
• Process name, date, facilitator and/or team members
2. List the functions involved in left column.
3. Document all activities/steps. No metrics yet!
• Verb/noun; concise language; include function as well.
4. Review the map for completeness.
5. Number the activities.
 One number per column; concurrent activities are labeled A, B, C, etc.
6. Add activity‐specific metrics (PT, LT, %C&A). (We are not 
considering number of workers and barriers to flow in 
this simulation.)
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 Create the Current State MBPM
Phase II

7.   Define the critical timeline path.
• Longest LT unless “dead‐end” step; use colored marker
8.   Create the timeline.
9.   Calculate the summary metrics
• CP PT Sum, CP LT Sum, AR, R%C&A, Total PT, Labor Required
10. Identify the VA and necessary NVA activities
• Use small colored post‐it labeled with “VA” and “N.”
11. Circle the step‐specific metrics that indicate the greatest 
opportunity for improvement.
• Use red marker.
• Long LTs, low %C&As, high PTs, low step‐specific ARs

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 Document Summary Metrics
Projected Projected %
Metric Current State Future State Improvement

Timeline
Critical Path PT
Timeline
Critical Path LT
Activity Ratio

Rolled %C&A
Total
Process Time
Freed capacity
 Future State Design
• Goals
– Reduce overall LT & PT
– Improve quality (increase RFPY)
– Increase % activity
– Improve LT, PT, and %C&A at individual steps
• May need to perform root cause analysis before 
determining countermeasures to realize the future 
state
• Mapping steps
– Clean sheet or modify current state map
– Same steps as current state
– Calculate projected metrics

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 Future State Design Considerations
• Eliminate steps / handoffs • Eliminate motion & 
• Combine steps transportation
• Create parallel paths • Standardize work
• Alter task sequencing and/or  • Eliminate unnecessary 
timing approvals / authorizations
• Implement pull • Stop performing non‐value 
• Reduce / eliminate batches adding (NVA) tasks
• Improve quality • Co‐locate functions based 
on flow; create cells 
• Create an organized, visual  (teams of cross‐functional 
workplace staff)
• Reduce changeover • Balance work to meet takt
time requirements

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 116

Resilience
Agility
Business Results

Innovation
Continuous 
Improvement
Problem Solving
Energy Crisis: Widespread Disengagement

11
7
Engagement Drivers: The Three C’s 

Connection

Creativity Control

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 Engagement Drivers
• Connection ‐ to mission, annual goals, 
immediate supervisor, people within the 
organization, customers.
• Control – heavy involvement in decisions that 
influence their work life.
• Creativity – Full use of talents, capacities, 
potentialities, and skills

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 It’s disrespectful to…
1. Not engage employees in work design and 
improvement.
2. First blame people instead of systems and processes.
3. Not help employees develop skills.
4. Not coach employees through problem solving – on an 
ongoing basis.
5. Have poorly designed processes which inhibit 
performance.
6. Fail to create and clearly communicate organizational 
goals and priorities.
7. Lack honesty and omit relevant information.

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 Group Activity – Driving Engagement
• Three groups:
– Connection
– Control
– Creativity
• Each group: 
– Identify activities and practices within your 
organization that engage or disengage employees in 
that area.
• Report out

121
 Activity: Engage or Disengage?
Engage Disengage
Connection

Control

Creativity

122
Reducing Self‐Inflicted Chaos: 
Where Should You Start?

123
 Places to Start…
1. Develop an intolerance for ambiguity.
2. Prioritize your work; reduce the number of 
active projects at once.
3. Ban electronic devices from meetings.
4. Adopt a problem‐solving methodology and 
deploy it broadly; get a coach!
5. Document, standardize and improve all major 
processes with significant involvement of the 
workers themselves.
6. Identify process owners and KPIs for each.

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 Group Activity – Closing the Gap
• Go back to your “weakest corner” (Clarity, Focus, 
Discipline or Engagement)
– List the lean practices/methods/tools that can be used 
to improve your organizations’ behaviors
– Report out to the class
• Next, look at your “self‐assessment” notecard, 
select one of your organization’s weakest areas, 
and begin creating a plan for how to start moving 
the needle (what’s the problem, what are 
potential root causes, what are potential 
countermeasures, who needs to be involved, etc.) 

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As Outstanding as They Come…

Discipline

12
6
Mike Osterling, President Karen Martin, Principal
4320 Woodland Drive 7770 Regents Road #635
La Mesa, CA 91941 San Diego, CA 92122
619.572.3632 858.677.6799

mike@mosterling.com ksm@ksmartin.com
Twitter: @karenmartinopex
Subscribe: www.ksmartin.com/subscribe
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 Our 
Books
October 2012

Just released Contributing Author
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